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Work-Sharing, Layoffs, and Intra-Firm Labour Transfers

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  • Takao Kato

Abstract

This paper develops a model of the firm with a fixed labour pool of heterogeneous workers. The first objective is to explain the difference between Japan and North America in the adjustment of labour in a recession. The Japanese adjustment -- intra-firm transfers rather than layoffs -- can be explained by large direct layoff costs of high-skilled workers, relatively small unemployment benefits and small direct transfer costs. The second objective is to investigate the relationship between work-sharing and layoffs.

Suggested Citation

  • Takao Kato, 1984. "Work-Sharing, Layoffs, and Intra-Firm Labour Transfers," Working Paper 565, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:565
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